Finding Text
Finding Number: Finding 2025-003 Program Name: Head Start and Early Head Start, Coronavirus State and Local Fiscal Recovery Funds Pass Through Agency: Sonoma County (Coronavirus State and Local Fiscal Recovery Funds) Type of Finding: Other Matter a. Criteria or Specific Requirement: Lack of Supporting Documents: Federal requirements under 2 CFR 200 section 303 state that the Organization must establish and maintain effective internal control over compliance, including controls to ensure payroll costs are charged to federal awards are supported by adequate documentation. Effective internal controls require maintaining sufficient personnel and payroll records, including executed offer letters, and written documentation of wage or position changes with appropriate approvals, to support payroll expenses charged to the program. Sonoma Community Action Network Schedule of Findings and Questioned Costs Year Ended February 28, 2025 34 b. Condition: During payroll testing, we noted instances in which supporting documentation was not retained for payroll activity including missing signed offer letters and / or written approvals of wage or position changes. c. Context: 41 out of 50 payroll transactions tested, did not contain adequate personnel documentation. Missing documentation primarily related to missing signed offer letters and lack of written approvals for wage or position changes. d. Questioned Costs: None identified. e. Cause: The Organization does not have standardized procedures for employee onboarding and retaining supporting personnel documentation. f. Effect: Considered to be other matter and area which requires improvement in internal controls. Without adequate supporting documentation for payroll costs charged to federal awards, the Organization is at increased risk of charging unsupported or unallowable costs to the program. g. Repeat: No. h. Recommendation: We recommend that management reinforce procedures requiring retention of complete supporting documentation for personnel records including offer letters and written approvals of all wage and position changes.